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HomeMy WebLinkAbout99-1030 McKeonKevin J. McKeon, Esquire Malatesta Hawke & McKeon LLP Harrisburg Energy Center 100 North Tenth Street Harrisburg, PA 17101 Dear Mr. McKeon: 1999. OPINION OF THE COMMISSION Before: Daneen E. Reese, Chair Austin M. Lee, Vice Chair Julius Uehlein Louis W. Fryman John J. Bolger Frank M. Brown Susan Mosites Bicket DATE DECIDED: 11/23/99 DATE MAILED: 12/7/99 99 -1030 Re: Lobbying, Administrative Action, Administrative Proceeding, Administrative Law, Exempt, Attorney, Agency, Agency Rulemaking, Public Utility Commission, Docket. This Opinion is issued in response to your advisory request received on October 8, I. ISSUE: Where an agency commences a proceeding for the purpose of considering the promulgation, revision or rescission of rules, policies, or guidelines, assigns a docket number to the matter, and makes all filings in that docket accessible to the public, is a lawyer's preparation and filing of comments at that docket, in an attempt to influence the outcome, activity which would qualify for exemption from the registration and reporting requirements of the Lobbying Disclosure Act under Section 1306(1) of the Act? II. FACTUAL BASIS FOR DETERMINATION: As an attorney who represents clients in numerous contexts before the Pennsylvania Public Utility Commission (PUC), you seek an advisory from this Commission under the Lobbying Disclosure Act. You state that you concentrate your practice in administrative law, and specifically, before the PUC. Your representation of clients before the PUC involves investigations, rate proceedings and rulemakings. You state that your law firm has long- standing attorney /client relationships with utilities and other parties who routinely participate in matters before the PUC and other McKeon, 99 -1030 December 7, 1999 Page 2 Pennsylvania administrative agencies. Your inquiry pertains to the phrase "administrative proceeding" that is within the exemption at Section 1306(1) of the Lobbying Disclosure Act (Act). You note that the Act defines "lobbying" to include an effort to influence...administrative action." The Act defines "administrative action," in pertinent part, as involving the "proposal, consideration, promulgation or rescission of a regulation," the "development or modification of a guideline or a statement of policy," or the "approval or rejection of a regulation." However, pursuant to Section 1306(1) of the Act, an individual who limits his lobbying activities to "participating in an administrative proceeding of an agency" is exempt from the registration and reporting requirements of Sections 1304 and 1305 of the Act. You state that you do not consider your participation in agency rulemaking to constitute "lobbying." However, you further state that this is the only activity which you undertake in your law practice that could be considered "lobbying" under the Act. You state that virtually all rulemakings and policy statements before Pennsylvania administrative agencies in general, and the PUC in particular, take place in the context of a formal proceeding that is docketed before the agency and is open to the public. You pose the following question: Where an agency commences a proceeding for the purpose of considering the promulgation, revision or rescission of rules, policies, or guidelines, assigns a docket number to the matter, and makes all filings in that docket accessible to the public, is a lawyer's preparation and filing of comments at that docket, in an attempt to influence the outcome, activity which would qualify for exemption from the registration and reporting requirements of the Lobbying Disclosure Act under Section 1306(1) of the Act? You contend that the exemption should apply to you. After noting that this particular exemption of Section 1306 applies to an individual who limits lobbying activities to participating in an administrative proceeding of an agency, you conclude that an "administrative proceeding" in the context of the Section 1306 exemption must be an activity already defined as "lobbying" under the Act. Since the pertinent portions of the definition of "administrative action" only include an agency's actions affecting regulations, policy statements or guidelines, you assert that it does not include any other activities typically undertaken by administrative agencies such as quasi - judicial, on- the - record, adversarial proceedings. Thus, you conclude that if the exemption is to be given effect, it must be read to apply to "lobbying" activities such as attempts to influence agency decisions concerning regulations, policy statements, or guidelines when those activities are undertaken in the context of an "administrative proceeding," such as a formally docketed rulemaking proceeding. You seek a ruling that an attorney who files comments in a docketed agency rulemaking, or who otherwise participates in a formal agency proceeding, the purpose of which is to promulgate or effect a change in a regulation, policy or guideline, would qualify for exemption under Section 1306(1) of the Act. By letter dated November 2, 1999, you were notified of the date, time, and location of the public meeting at which your request for an Opinion was to be considered. III. DISCUSSION: It is initially noted that pursuant to Section 1308(c) of the Act in conjunction with Sections 1107(10) and 1107(11) of the Ethics Act, 65 Pa.C.S. § §1107(10), (11), advisories are issued to the requestor based upon the facts which the requestor has submitted. The Commission does not engage in an independent investigation of the facts, nor does it speculate as to facts which have not been submitted, in issuing advisories. It is the burden of the requestor to truthfully disclose all of the material facts relevant to the inquiry. An advisory only affords a defense to the extent the requestor has truthfully disclosed all of the material facts. McKeon, 99 -1030 December 7, 1999 Page 3 In order to decide the issues which you have raised, this Commission must review the pertinent definitions and substantive provisions of the Act and related Regulations. Section 1303 of the Act defines "lobbying" as follows: "Lobbying." An effort to influence legislative action or administrative action. The term includes: (1) providing any gift, entertainment, meal, transportation or lodging to a State official or employee for the purpose of advancing the interest of the lobbyist or principal; and (2) direct or indirect communication. 65 Pa.C.S. §1303. The key terms "legislative action," "administrative action," "direct communication," and "indirect communication" that are within the definition of "lobbying" are themselves defined as follows: "Legislative action." An action taken by a State official or employee involving the preparation, research, drafting, introduction, consideration, modification, amendment, approval, passage, enactment, tabling, postponement, defeat or rejection of legislation; legislative motions; overriding or sustaining a veto by the Governor; or confirmation of appointments by the Governor or of appointments to public boards or commissions by a member of the General Assembly. "Administrative action." Any of the following: (1) An agency's: (i) proposal, consideration, promulgation or rescission of a regulation; (ii) development or modification of a guideline or a statement of policy; or (iii) approval or rejection of a regulation. (2) The review, revision, approval or disapproval of a regulation under the act of June 25, 1982 (P.L.633, No.181), known as the Regulatory Review Act. (3) The Governor's approval or veto of legislation. (4) The nomination or appointment of an individual as an officer or employee of the Commonwealth. (5) The proposal, consideration, promulgation or rescission of an executive order. "Direct communication." An effort, whether written, oral or by any other medium, made by a lobbyist or principal, directed to a State official or employee, the purpose or foreseeable McKeon, 99 -1030 December 7, 1999 Page 4 effect of which is to influence legislative action or administrative action. "Indirect communication." An effort, whether written, oral or by any other medium, to encourage others, including the general public, to take action, the purpose or foreseeable effect of which is to directly influence legislative action or administrative action. The term includes letter- writing campaigns, mailings, telephone banks, print and electronic media advertising, billboards, publications and educational campaigns on public issues. The term does not include regularly published periodic newsletters primarily designed for and distributed to members of a bona fide association or charitable or fraternal nonprofit corporation. 65 Pa.C.S. §1303. The terms "principal" and "lobbyist" are defined in the statute as follows: "Principal." Any individual, firm, association, corporation, partnership, business trust or business entity: (1) on whose behalf a lobbyist influences or attempts to influence an administrative action or a legislative action; or (2) that engages in lobbying on the principal's own behalf. Id. "Lobbyist." Any individual, firm, association, corporation, partnership, business trust or business entity that engages in lobbying on behalf of a principal for economic consideration. The term includes an attorney who engages in lobbying. As for the substantive provisions to be reviewed, the following exemption set forth in Section 1306(1) of the Act is pertinent to our review: § 1306. Exemption from registration and reporting The following individuals and activities shall be exempt from registration under section 1304 (relating to registration) and reporting under section 1305 (relating to reporting): (1) An individual who limits lobbying activities to preparing testimony and testifying before a committee of the legislature or participating in an administrative proceeding of an agency. 65 Pa.C.S. §1306(1). In applying the above provisions to your inquiry, we initially note that exemptions under the Act are strictly construed. See, Cook, Opinion 99 -1001; Artz, Opinion 99 -1007. In order to qualify for exemption from registration and reporting under the Act, all of the conditions for the given exemption must be met. Artz, supra. McKeon, 99 -1030 December 7, 1999 Page 5 The exemption at Section 1306(1) of the Act begins: " An individual who limits lobbying activities to - -- ." (Emphasis added). This language indicates that the exemption is only applicable to individuals, not entities, and that it is only applicable to individuals who limit lobbying activities to the specific types of activities delineated therein. Artz, supra. Further, the phraseology does in fact connote that the activity in question is lobbying. Thus, we agree with the portion of your argument that if the exemption is to be given effect, it must be read to substantively apply to "lobbying" activities such as attempts to influence agency decisions concerning regulations, policy statements, or guidelines when those activities are undertaken in the context of an "administrative proceeding," such as a formally docketed rulemaking proceeding. We now focus upon the key language, an administrative proceeding," to determine the scope of the exemption. It is clear that the exemption only applies to an individual who so participates in only one such administrative proceeding before one agency during a given biennial registration period. This is so for the following reasons. If the General Assembly had intended for the exemption to apply to participation in more than one such administrative proceeding during the biennial registration period, it would have so stated. It did not. Indeed, the preceding phrase in the exemption similarly speaks to preparing testimony and testifying before "a" committee of the legislature. The clear legislative intent was that this exemption apply only to individuals whose lobbying activity was limited both as to its nature and its frequency. Ignoring the strict criteria of the exemption and applying it, for example, to an attorney who submits comments to more than one such docketed proceeding before one or more agencies during a given biennial registration period would defeat the whole purpose of the Act by allowing extensive lobbying to occur as to administrative action with no accountability under the Act. The General Assembly did not intend such an anomalous result. Thus, we find that the particular phraseology of the exemption which is limited to " an administrative proceeding of an agency" reflects a limitation of the exemption to a one instance involvement with an administrative proceeding of one agency during a given biennial registration period. This interpretation achieves the balance the General Assembly was seeking in requiring disclosure of efforts as to administrative action but granting an exemption to the individual who limits such activity to an administrative proceeding of an agency. Based upon the facts which you have submitted, it is not clear whether you are involved in more than one such administrative proceeding. If you would not qualify for the exemption based upon our above interpretation, and if the total compensation that you would receive for engaging in such activities would exceed $2500 in any quarter, you would be required to register under the Act within ten days of crossing the $2500 threshold, unless your involvement in such activities would constitute the practice of law. In our view, it is a fundamental principle that lobbying and the practice of law are separate, distinct and mutually exclusive activities. Artz, Opinion 99 -1007; Flaherty, Opinion 99 -1010. However, it is also our position that the practice of law is properly limited to those services which may not lawfully be performed by anyone but an attorney, that is, those services which if performed by a non - lawyer would constitute the unauthorized practice of law. Thus, where the representation of a client in such an administrative proceeding could legally only be performed by an attorney, then representation of a client in such activities would not constitute lobbying. The propriety of the proposed conduct has only been addressed under the Act and derivatively the Ethics Act to the extent applicable; the applicability of any other statute, code, ordinance, regulation or other code of conduct has not been considered in that they do not involve an interpretation of the Act. McKeon, 99 -1030 December 7, 1999 Page 6 IV. CONCLUSION: The exemption at Section 1306(1) of the Lobbying Disclosure Act substantively applies to attempts to influence agency decisions concerning regulations, policy statements, or guidelines when those activities are undertaken in the context of an "administrative proceeding," such as a formally docketed rulemaking proceeding. However, an individual's preparation and filing of comments at such an administrative proceeding, in an attempt to influence the outcome, would not qualify for exemption from the registration and reporting requirements of the Lobbying Disclosure Act under Section 1306(1) of the Act unless the individual's lobbying activities would be limited to so participating in only one such administrative proceeding before one agency during a given biennial registration period. Where the representation of a client in such an administrative proceeding could legally only be performed by an attorney, then representation of a client in such activities would not constitute lobbying. Pursuant to Section 1308 of the Act, a requestor who truthfully discloses all material facts in a request for an advisory and who acts in good faith based upon a written opinion of the Commission issued to the requestor shall not be held liable for a violation of the Act. This Opinion is a public record and will be made available as such. Finally, a party may request this Commission to reconsider its Opinion. The reconsideration request must be received at this Commission within thirty days of the mailing date of this Opinion. The party requesting reconsideration must include a detailed explanation of the reasons as to why reconsideration should be granted in conformity with 51 Pa. Code §39.1. By the Commission, Daneen E. Reese Chair